Welcome to the June 2018 Newsletter from Simmons Gainsford LLP
HMRC has delayed the full roll-out of its new digital tax initiative, Making Tax Digital (MTD), as a result of ongoing Brexit preparations. Plans for MTD for individuals have been put on hold to allow the Revenue to ‘reallocate’ its resources to dealing with Brexit plans.
Meanwhile, HMRC has also issued a warning over the latest tax refund scams, which have seen criminals sending fraudulent messages to taxpayers as HMRC processes genuine tax refunds.
HMRC delays full roll-out of Making Tax Digital as result of Brexit
HMRC has delayed the full roll-out of Making Tax Digital (MTD) while the UK makes preparations to leave the EU in 2019.
MTD for individuals was scheduled to take effect from 2020. However, the government has revealed that the plans have been put on hold to allow HMRC to focus on the UK’s Brexit preparations.
In a letter to tax professionals, HMRC stated: ‘We have made the decision to delay plans to release project capability to EU exit work. This means halting progress on Simple Assessment and real-time tax code changes.’ HMRC proceeded to say that the foundations for MTD for individuals have been laid, which will enable the government to return to the initiative ‘in the future’.
Responding to the news, Yvette Nunn, Co-Chair of the Technical Steering Group at the Association of Taxation Technicians (ATT), stated: ‘Given the unprecedented changes which will result from Brexit, it is only sensible that HMRC seek to prioritise their work. While we welcome the pause . . . we strongly urge HMRC to use the extra time given to iron out the known problems with Simple Assessment and dynamic coding before they hit play on them again.’
HMRC confirmed that MTD for VAT is set to take effect from April 2019, as previously planned. From this time, businesses with a turnover above the VAT registration threshold (currently £85,000) will be required to keep digital records for VAT purposes and submit VAT returns using MTD functional compatible software.
Meanwhile, HMRC has added two new software providers to the MTD for income tax pilot scheme, bringing the current total to four.
The software providers signed up to the MTD for income tax pilot will be required to supply reporting tools to those taking part in the pilot, in order for them to send income and expenses summaries to HMRC every three months. Participating sole traders will then be required to submit a final report to confirm all income and expenses for the year, and to claim any allowances or reliefs they may also be entitled to.
Warning issued over tax refund scams
HMRC has issued a warning to taxpayers regarding the latest tax refund scams, which have been targeting individuals via email and SMS messages.
As HMRC processes genuine tax refunds for the 2017/18 tax year, fraudsters are sending scam messages which claim that taxpayers are entitled to a rebate, and request that they provide their personal and bank account details in order to make their claim.
Criminals use links in fraudulent messages to redirect victims to suspicious websites, within which personal data can be stolen.
HMRC revealed that, in March, it received 2,672 requests to shut down phishing websites, and 84,549 phishing reports.
The Revenue is keen to emphasise that it will only ever inform individuals of a tax refund by post or through their employer, and never via email, text messaging or voicemail. It urges taxpayers to recognise the signs in order to help identify scam messages, and stressed that HMRC will never contact individuals at random to request sensitive personal financial information.
Commenting on the issue, Treasury Minister, Mel Stride, said: ‘We know that criminals will try and use events like the end of the financial year, the self assessment deadline, and the issuing of tax refunds to target the public and attempt to get them to reveal their personal data. It is important to be alert to the danger.’
Taxpayers are advised not to click on any links in suspicious communications, download any attachments or provide any personal information, and to forward any suspect messages or emails to HMRC.
ESSENTIAL TAX DATES FOR JUNE
New Advisory Fuel Rates (AFR) for company car users apply from today.
PAYE, Student loan and CIS deductions are due for the month to 5 June 2018.
End of CT61 quarterly period.
QUOTE OF THE MONTH
‘Coping with stress in the workplace starts with being able to have a conversation with your manager, and in a mentally healthy organisation everyone should feel comfortable talking about stress.’
Jaan Madan, Workplace Lead at Mental Health First Aid England, commenting on research that suggests that millennials feel ‘most under pressure’ at work.
WEBSITE OF THE MONTH
Government site dedicated to assisting UK businesses in successfully trading overseas.
ON OUR WEBSITE
A wealth of resources for businesses
With topics ranging from Making Tax Digital to the Criminal Finances Act 2017, the Your Business section of our site is a hub of essential information.
Useful information for individuals
For a comprehensive bank of guides covering the Dividend Nil Rate, giving to charity and much more, please visit the Your Money area of our website.